Vedanta Eyes Up To 450,000 Tons Of Zinc From International Mines

LONDON (Dow Jones)--U.K.-listed, India-focused Vedanta Resources PLC (VED.LN) Friday said its international zinc operations are on track to produce 440,000 tons to 450,000 tons of zinc in the current financial year.

M.S. Mehta, Vedanta's chief executive, told analysts in a conference call that "we expect to deliver almost 440,000 tons to 450,000 tons" in fiscal year ending March 31, 2012.

He said production in the second half of the financial year would roughly equal that of the first half.

Zambia's international zinc operations in the first half of the financial year produced 76,000 tons of refined zinc from the Namibian Skorpion mine and 157,000 tons of mined zinc metal from the South African Black Mountain mine and the Irish Lisheen mine.

Vedanta became the world's largest integrated zinc producer following its $1.34 billion purchase of Anglo American PLC's (AAL.LN) assets mentioned above.

Mehta said falling zinc prices would eventually crimp the company's profit margin but he assured analysts that it wouldn't prompt the company to turn off its zinc production since the international zinc operations sit at the low end of the cost curve.

Mehta noted that zinc prices are currently trading at below the marginal cost of production.

Zinc is trading at 1,875 a metric ton, up 0.4% on the day. Zinc has fallen 25% since the end of July due in part to investor concerns about the state of the global economy and sovereign debt fears.